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RE: Steem experiment: Burn post #103
Returning the price of SBD back to $1 should also make the price of Steem go down to a similar price as well. Do you see it that way as well or am I missing something here?
I also see it this way! When he said burn I thought he meant send it to @null. Part of rising Steem is rising SBD and vice versa. Also, I'm not sure if it's mentioned somewhere but where is the SP from this account delegated to?
Its not exactly clear to me, I think everyone with critical thinking skills needs to examine this more.
I agree, I don't think this is helping us at all...
However, after checking out the account's delegations, I have realised that the delegations are to bots that downvote spam etc, thus helping the rewards pool remain large for genuine users.
I think a more effective method would be to keep delegating Steem Power to bots that help lessen the "reward pool rape" and burn all SBD rewards to maintain SBD price.
Good investigative work, it would be nice to keep on an eye those bots. SBD was designed to be pegged at a dollar but was manipulated to gain a price well above that. I am cool with SBD going back to $1 as it was intended but everyone needs to be aware so they can plan accordingly. If they truly want to keep Steem Backed Dollar at $1 it needs to be consistent and not just a now and then thing.
Thanks! After getting home I read also read that the SP would be delegated to downvote bots only on @burnpost's initial introduction!
What you say is true, however everyone's profits would be a lot lower if SBD was pegged back down to $1 as originally planned. However, I also feel like it's inevitable that SBD price drops down as it's essentially a useless currency with price artificially driven up by "speculation" (pump and dumps), so I convert all my SBD to Steem whenever I can, even if I don't plan on powering up!
In regards to consistency, I also agree! If the price fluctuates a lot, chances are the price of Steem will fluctuate a lot. I don't care if Steem moons or not, I just want to make sure it doesn't drop too much.
No I don't see it that way. Yes the inflated price of SBD does boost the short term rewards, and this does increase the STEEM price to some extent, because people may buy STEEM in order to extract the rewards from the pool using bid bots (not that this actually helps the user base in any way, it is an arms race that benefits almost entirely the arms merchants who in this case are the bid bots and bid bot delegators).
However, even if you see that as a positive (I don't) it is ultimately unsustainable anyway. If nothing else happens, sooner or later (and probably sooner, as it already started recently) the system will stop paying out in SBD and pay out in STEEM. Rewards will drop to their intended value of about 1/2 of what they are now, the added demand attributable to bid bot revenues will go away, and the STEEM price will drop anyway. Unlike with @burnpost, none of the extra demand for SBD is channeled over the STEEM, nor is the STEEM supply reduced (in fact it is increased).
Overall I think @burnpost (even a scaled up version that would actually have a more significant effect on the market) is better: 1. Directly increases the STEEM price by channeling excess demand in SBD back to STEEM, and then long term by reducing the STEEM supply with burning). 2. Restores the utility of SBD as a pegged asset. 3. Helps avoids oversupply of SBD and cut off of SBD printing (the oversupply is a secondary effect of the overvaluation).
I agree with what you are trying to do, but I also think its important to make everyone you can aware of this. It could possibly hurt those that are using steemit the way it should be used and are just trying to gain exposure using bid bots. I am all for getting SBD back to its pegged price so we can start doing 100% power up posts again. I expect the price of Steem to fall with the price of STB if the $1 peg can be sustained with the systems we have in place. I think its a positive long term, but it may be very painful for quite a few people early on.
Please reread this portion:
When that happens, the SBD party is over no matter what. Those for whom it will be painful had better brace themselves. Winter is coming.
Apart from the above (it will happen anyway), this doesn't hurt anyone paying for exposure. They will still be able to use bid bots to pay for exposure. It will just cost less to do so!
@burnpost doesn't really change anything about the reward payouts, they are going to lose the benefit of SBD overvaluation no matter what. What it is doing is channeling this inevitability to help the system in other ways.
I was wondering why I was getting some payouts in Steem, now it all makes sense. I still think Steem will stay close to the price of SBD if we take action now or not. Thanks for taking the time to explain your reasoning, It will be an interesting experiment to watch.